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India: Why Apple Walked Away
by Lost at 12:14 pm EDT, Jun 19, 2006

Plans for an Indian tech support center have been scrapped. A cautionary tale
Apple CEO Steve Jobs has long had a thing for India. After work- ing at game developer Atari (ATAR ) in the mid-'70s, Jobs took a break and backpacked around the subcontinent in search of spiritual enlightenment. Upon his return to the U.S., his more capitalistic instincts took over, and he and Steve Wozniak launched Apple. Today, of course, the seeker-turned- billionaire enjoys a reputation as one of the most successful entrepreneurs and savviest marketing minds on the planet.

I can hire Java guys Bangalore with 3-5 years of experience for $3K a month, and that includes facilities, a PC, network, etc. He may not be brilliant, but he is cheap. Cost of employment there is $36,000 a year. Cost of employment on his American equivalent would be well over $100,000 a year. Most every article I see on outsourcing skews these numbers horribly. Its as though they've never gotten an actual quote in researching their articles. You can hire graduates for $700 a month, if you've got an office. The problem with direct hiring is retaining people. A guy will leave you for $800 a month with zero notice.

Apple's problems would be a little different as they were creating a call center. In my opinion, outsourcing call centers is a TERRIBLE idea. Culture matters in customer service, and giving a guy named Ganesh the name George and forbidding him from giving out his real name is hardly the equivalent of actual cross-cultural education.

Call centers in India are for companies that don't give a shit about customer service. Development centers are not neccessarily this way. The fact that the Apple Service tech I talk to is intimately familiar with technology because he's been a computer dork since age 5 and that he is acclimated to the Western hemisphere matters in whether I recieve satisfactory customer service. Not that customer service for an IT company is a dream job, but in the states people have options and so this job attracts a certain type of person.

A person that is well suited to the job. In India, where opportunity is limited and jobs affording entry to the middle class are not very diverse, this is not the case. If you're from the right city, and you can't become a doctor or a software engineer by getting a CS degree or any engineering degree and then becoming an indentured servant in exchange for training, you try to work at a call center. This being the case, odds are you are not suited to this work, and cultural barriers aside, will suck at it.

It is ironic that 'high value' activities like software development can be successfully outsourced, but 'low value' activities like customer service cannot.

In engineering, your American domain experts can act as quality assurance personnel, ensuring that code from Indian engineers who may not have a perfect grasp of the problem you're trying t... [ Read More (0.3k in body) ]

RE: India: Why Apple Walked Away
by ubernoir at 5:57 pm EDT, Jun 19, 2006

i was very interested to read your post on outsourcing in general and regarding call centres in particular. Due to mental health problems triggered by stress principally i need to work in a relatively stress free environment so i work in a call centre on the phones i ignore the targets by and large and my managers all know i'm very good on the phone but my job is being outsourced to India.
I think I do a good job because i can mostly handle the range of accents, i can handle the problems and usually diffuse the complainers. I believe in free markets and I like the idea of wealth creation going to the developing world through outsourcing. I suspect a lot of the outsourced call centres will return to locations staffed by people more linguistically in tune with the target audience. It is sometimes a challenge to catch the gist of a 70 year old Tynesider who is beginning show signs of Alzheimer's. I sometimes have to listen very carefully and i'm English with an English degree.

Call centers in India are for companies that don't give a shit about customer service.

the problem is that the people who make these outsourcing decisions are completly cut off from the day to day customer service level
they're quite happy to let customers wait on the phone for 20 minutes minimum in a queue ( i speak to people all day long who've been trying to get through to someone all day long and they phone the line i work on because it has short queues but i just have to explain that there's nothing i can do and that i have no shortcuts)
these managers see that it is a low paid job and consider it unskilled and don't understand that one of the skills in this case is having an intuititive understanding of the language, and the culture, from being raised in it ( a point which therefore includes my British-Asian colleages, born in Leicester, a city which according to Wikipedia is due shortly to have a population where the majority is not ethnically white European.)
the bean counters will learn by market forces that there is more to customer service than just having a warm body on the other end of a telephone; and that's once the customers have negiotiated the automated call menu system which customers generally hate (they can be a useful tool but there are so many badly designed ones that won't just let you speak to a person or are just plain badly designed)